“Plans to cut staff are at an advanced stage but are not closed yet,” Goirigolzarri said at an economic forum in Madrid, refusing to give any concrete figures.

Last week daily newspaper Expansion said Bankia was planning to lay off 2,000 workers.

Seeking to boost earnings, Bankia agreed in June to acquire BMN to create the country’s fourth-biggest bank, which it expects to legally close in December.

Like its Spanish competitors, Bankia is struggling to lift earnings from loans in Spain as interest rates hover at historic lows, while increasing competition erodes margins.

As a result, Spanish banks have been trimming costs, including through branch closures, since a 2012 financial crisis which ate into earnings and pushed some into state bailouts.

Economy Minister Luis de Guindos said on Tuesday that the government, which owns 67 percent of Bankia, was planning to further sell stakes in the lender “as soon as possible”. (Reporting By Jesús Aguado; Editing by Paul Day)